The ‘Trump Trade’ Is Now on Its Way, According to Economist Alex Krüger – Here’s His Outlook

A popular economist thinks crypto enthusiasts should factor the “Trump Trade” into their portfolio decisions.

Alex Krüger tells his 177,300 followers on the social media platform X that a November election victory for former president Donald Trump will likely be bullish for crypto.

“Reason: Trump’s administration might pursue supportive regulations for cryptocurrencies, fostering innovation and adoption.”

Krüger believes a future Trump Administration will implement tax cuts and increased government spending, which he thinks could lead to “higher inflation expectations and rising long-term interest rates, resulting in a steeper yield curve.”

A steep yield curve indicates that yields on long-term bonds are rising faster than yields on short-term government-backed securities. It is often witnessed during the early stages of an economic expansion.

The economist also says Trump will likely pursue deregulation, which could be bullish for oil and gas, steel, coal and the financial industry.

“Deregulation in the financial sector could reduce compliance costs and increase profitability for financial institutions. A steepening yield curve is also beneficial for financial institutions, which profit from the wider spread between short-term borrowing rates and long-term lending rates.”

Krüger thinks a Trump victory will be bearish for renewable energy and healthcare, however.

“You can trade around Trump winning even if you dislike Trump. Don’t let your political orientation affect your perception of odds or how to trade these odds.”

In a bid to raise campaign funds and differentiate himself from President Joe Biden, Trump, who survived an assassination attempt over the weekend, has staked out a position as a crypto-friendly candidate this year, though he previously described digital assets as “a disaster waiting to happen.”

In May 2018, while serving in the Oval Office, he also reportedly directed then-Treasury Secretary Steven Mnuchin to “go after Bitcoin [for fraud].”

Trump’s 2024 presidential campaign has started accepting crypto donations, receiving $2 million worth of Bitcoin (BTC) from Gemini crypto exchange co-founders Tyler and Cameron Winklevoss.

In May, a jury found Trump guilty on 34 felony counts related to falsifying business records ahead of the 2016 presidential election.

 

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